With the ability to bet on virtually anything and everything, you make it very easy for people with insider political knowledge to get very very rich. This is a very dishonorable and problematic...
An unknown trader has raked in a profit worth about $410,000 after betting that Venezuelan president Nicolas Maduro would be ousted from his position.
The trader's account on Polymarket, opens new tab built up positions in contracts tied to Maduro's removal on terms that implied long odds before the weekend raid. Those wagers, which were worth about $34,000 prior to Maduro's capture, surged in value after news of the U.S. military operation on the Venezuelan leader emerged, Polymarket data shows.
With the ability to bet on virtually anything and everything, you make it very easy for people with insider political knowledge to get very very rich. This is a very dishonorable and problematic way to make money, but the libertarian in me wants to play devil's advocate and say that, in a strange way, this is essentially a whistleblower's bounty in service of the public. If we say that secrecy is in general a bad, especially in powerful and basically unaccountable institutions, then it may be considered a good to allow for this information to indirectly trickle out through betting markets. On the other hand, does it incentivize these institutions to take more unpredictable actions, simply because they are unpredictable, to be able to make huge returns through insider knowledge?
I mean, it's not a stock market. Polymarket wants insiders to bet. The point is to have a probability as close to the "true" ground truth probability of an event as possible. The more information...
I mean, it's not a stock market. Polymarket wants insiders to bet. The point is to have a probability as close to the "true" ground truth probability of an event as possible. The more information is sloshing around in the market, the better. Insiders are, in a way, the most valuable betters for a prediction market.
If Donald Trump himself was betting on national affairs, that would be optimal.
Ultimately it's as dishonorable as the game is setup to be. I don't think anyone should expect insiders not to bet on polymarket - it's more of a game of who is more of an insider. Insider info is a spectrum, after all.
This is all justified as a way to get more useful public information, but I think the value of that information is pretty sparse and low-value because it’s opaque. It’s a Ouija board. You get out...
This is all justified as a way to get more useful public information, but I think the value of that information is pretty sparse and low-value because it’s opaque. It’s a Ouija board. You get out changes to a number on a graph and nobody really knows why. Confident whales can lose and there’s no way to check their work.
Perhaps the conversation around a prediction market could have some value, like someone betting and then posting evidence to try to convince others.
From their documentation (absolutely NOT endorsing it but that's what they claim at least):
From their documentation (absolutely NOT endorsing it but that's what they claim at least):
Prediction markets provide unbiased and accurate probabilities in real time, cutting through the noise of human and media biases. Traditional sources often have their own incentives and slants, but prediction markets operate on the principle of “put your money where your mouth is.” Here, participants are financially motivated to provide truthful insights, as their profits depend on the accuracy of their predictions.
In a prediction market, prices reflect the aggregated sentiment of all participants, weighing news, data, expert opinions, and culture to determine the true odds. Unlike media narratives, which can be swayed by various biases, prediction markets offer a transparent view of where people genuinely believe we’re heading.
In theory, if an insider knows that a given outcome is going to happen, they're incentivised to put a large amount of money on that thing happening because they'll make a guaranteed return - and...
In theory, if an insider knows that a given outcome is going to happen, they're incentivised to put a large amount of money on that thing happening because they'll make a guaranteed return - and that in turn skews the derived probability heavily in favour of their position, communicating to everyone else that the outcome is likely. Polymarket's reputation is based on accurate prediction, so this is in their favour, at least if we put aside the potential negative externalities of leaking secret information that other people have mentioned.
The difficulty is that this assumes everyone's playing on a more or less even financial footing, otherwise big players can choose to skew the derived predictions by sheer volume (potentially for purposes more lucrative to them than winning the Polymarket bet), and it assumes that the insider knows about a predetermined outcome without being sufficiently incentivised to alter that outcome (perhaps in a way that's detrimental to everyone else, including those who made what would otherwise have been the "correct" prediction) in order to make their Polymarket bet pay out.
No, polymarket is a betting exchange. For every bet you make, there’s another user on the other side. In contrast, with a bookmaker, each player is betting against the bookmaker, who is trying to...
No, polymarket is a betting exchange. For every bet you make, there’s another user on the other side. In contrast, with a bookmaker, each player is betting against the bookmaker, who is trying to craft odds such that they profit.
In that respect, polymarket doesn’t really care if some users are better than others. They take a percentage cut from the transactions. The $400,000 the guy in the story won came from other betters, not polymarket.
As a casino analogy, casinos care if people playing blackjack are too good at counting cards, because they’re playing against the casino. The casino does not care if poker players are “too good”, since they just take a fixed rake from each table, and the players wins and losses come from each other.
On a more philosophical level, the point of a prediction market is to have accurate probabilistic modeling via exchange betting. The more information, the more accurate the markets results are.
Leaking information about top secret military operations is... bad. Ignoring the moral issues with this specific military operation, the practice of leaking military secrets for personal profit...
Leaking information about top secret military operations is... bad. Ignoring the moral issues with this specific military operation, the practice of leaking military secrets for personal profit already has a name: treason.
I mean this is the least of your problems from it. You're risking peoples lives. If this is an insider they're ABSOLUTELY in violation of about 1000x laws that would see a normal person behind...
On the other hand, does it incentivize these institutions to take more unpredictable actions, simply because they are unpredictable, to be able to make huge returns through insider knowledge?
I mean this is the least of your problems from it. You're risking peoples lives. If this is an insider they're ABSOLUTELY in violation of about 1000x laws that would see a normal person behind bars for life for violating national security and endangering an operation and the lives of those carrying it out.
And on the other side "well of course they'll reinforce the levy" is not something you want insiders taking the long odds on.
There are some additional details in this NPR article https://www.npr.org/2026/01/05/nx-s1-5667232/polymarket-maduro-bet-insider-trading Emphasis mine, so if the US cared to prosecute anyone, and...
Online sleuths have attempted to identify this trader with no luck. The account, which originally went by the handle "Burdensome-Mix" before changing its display name to a string of letters and numbers, joined Polymarket just weeks ahead of making the Maduro trade.
Chainalysis, a company that tracks crypto theft, told NPR it cannot determine the person behind the account, but noted that they are using several U.S. crypto exchanges to cash out, suggesting they are not trying to conceal their identity by funneling money through shadowy overseas exchanges, something that is typical in crypto fraud schemes.
Emphasis mine, so if the US cared to prosecute anyone, and that's a big if, then supposedly they have a solid lead there, if I'm understanding how that works
With the ability to bet on virtually anything and everything, you make it very easy for people with insider political knowledge to get very very rich. This is a very dishonorable and problematic way to make money, but the libertarian in me wants to play devil's advocate and say that, in a strange way, this is essentially a whistleblower's bounty in service of the public. If we say that secrecy is in general a bad, especially in powerful and basically unaccountable institutions, then it may be considered a good to allow for this information to indirectly trickle out through betting markets. On the other hand, does it incentivize these institutions to take more unpredictable actions, simply because they are unpredictable, to be able to make huge returns through insider knowledge?
I mean, it's not a stock market. Polymarket wants insiders to bet. The point is to have a probability as close to the "true" ground truth probability of an event as possible. The more information is sloshing around in the market, the better. Insiders are, in a way, the most valuable betters for a prediction market.
If Donald Trump himself was betting on national affairs, that would be optimal.
Ultimately it's as dishonorable as the game is setup to be. I don't think anyone should expect insiders not to bet on polymarket - it's more of a game of who is more of an insider. Insider info is a spectrum, after all.
This is all justified as a way to get more useful public information, but I think the value of that information is pretty sparse and low-value because it’s opaque. It’s a Ouija board. You get out changes to a number on a graph and nobody really knows why. Confident whales can lose and there’s no way to check their work.
Perhaps the conversation around a prediction market could have some value, like someone betting and then posting evidence to try to convince others.
Why does it benefit polymarket to have insiders trade? I’m pretty ignorant to the whole set up.
Is it different than a book maker ?
From their documentation (absolutely NOT endorsing it but that's what they claim at least):
In theory, if an insider knows that a given outcome is going to happen, they're incentivised to put a large amount of money on that thing happening because they'll make a guaranteed return - and that in turn skews the derived probability heavily in favour of their position, communicating to everyone else that the outcome is likely. Polymarket's reputation is based on accurate prediction, so this is in their favour, at least if we put aside the potential negative externalities of leaking secret information that other people have mentioned.
The difficulty is that this assumes everyone's playing on a more or less even financial footing, otherwise big players can choose to skew the derived predictions by sheer volume (potentially for purposes more lucrative to them than winning the Polymarket bet), and it assumes that the insider knows about a predetermined outcome without being sufficiently incentivised to alter that outcome (perhaps in a way that's detrimental to everyone else, including those who made what would otherwise have been the "correct" prediction) in order to make their Polymarket bet pay out.
No, polymarket is a betting exchange. For every bet you make, there’s another user on the other side. In contrast, with a bookmaker, each player is betting against the bookmaker, who is trying to craft odds such that they profit.
In that respect, polymarket doesn’t really care if some users are better than others. They take a percentage cut from the transactions. The $400,000 the guy in the story won came from other betters, not polymarket.
As a casino analogy, casinos care if people playing blackjack are too good at counting cards, because they’re playing against the casino. The casino does not care if poker players are “too good”, since they just take a fixed rake from each table, and the players wins and losses come from each other.
On a more philosophical level, the point of a prediction market is to have accurate probabilistic modeling via exchange betting. The more information, the more accurate the markets results are.
Leaking information about top secret military operations is... bad. Ignoring the moral issues with this specific military operation, the practice of leaking military secrets for personal profit already has a name: treason.
I mean this is the least of your problems from it. You're risking peoples lives. If this is an insider they're ABSOLUTELY in violation of about 1000x laws that would see a normal person behind bars for life for violating national security and endangering an operation and the lives of those carrying it out.
And on the other side "well of course they'll reinforce the levy" is not something you want insiders taking the long odds on.
Mirror: https://archive.is/nDm3L
There are some additional details in this NPR article https://www.npr.org/2026/01/05/nx-s1-5667232/polymarket-maduro-bet-insider-trading
Emphasis mine, so if the US cared to prosecute anyone, and that's a big if, then supposedly they have a solid lead there, if I'm understanding how that works